5 Ways Employers Can Mitigate the Risks of Attorney Referral Medicine

While there is a place for attorney referral medicine, it’s fraught with the potential for abuse and unethical practices.
By: and | April 24, 2023

If you’re not familiar with the term “attorney referral medicine,” it’s a practice in which an injured worker’s attorney refers to particular physicians or other providers for treatments and services related to the injury.

If the injured worker doesn’t have workers’ compensation or other injury benefits available, or is otherwise being mistreated, there may be a place for attorney referral medicine.

But this is rarely the case, and attorney referral medicine is fraught with the potential for abuse and unethical practices.

What Is the Impact on Injured Workers?

The attorney may focus on medical providers known to increase the amount of damages claimed by and the compensation payable to the attorney at the expense of the injured worker’s health. For example, this may include:

  • X-rays read by a disreputable radiologist
  • Sending an injured worker to a chiropractor instead of an orthopedic surgeon or other more highly qualified provider
  • Referral to medical providers that offer special deals or discounts to the referring attorney to secure referrals
  • Unnecessary, incorrect or incomplete treatments or services that harm the injured worker

How Are “Letters of Protection” Used?

A letter of protection is an agreement between a medical provider and an attorney that states the patient will not be billed for the services provided until a settlement has been reached with the responsible party.

To rein in common abuses, some states have specific regulations regarding letters of protection.[i] The American Academy of Orthopedic Surgeons also suggests that its members seek legal advice when entering any LOP agreement and ensure the terms are clearly articulated and understood by all parties.

It is important for injured workers to remain vigilant about potential abuses with letters of protection and make every attempt to access medical care and support under any available group health, workers’ compensation or injury benefit program at the employer’s expense.

What Is the Impact on Employers (and Insurers)?

First and foremost, attorney referral medicine can result in worse medical outcomes and slower (or no) return to work for a valued employee.

Attorney referral medicine is also intended to create the appearance that negligence on the part of the employer caused the injury and the employer is not providing proper medical care to the injured worker — in spite of the fact that the employer may be ready, willing and able to pay for the best medical care from more qualified providers.

This practice may be less about finding the path to an optimal physical and mental recovery for the injured worker and more aimed at running up the highest claim for damages and increasing employer litigation costs to motivate a settlement more favorable to the injured worker’s counsel.

5 Tips to Help You Avoid Attorney Referral Medicine

  1. Reduce complexity by providing a simple explanation of work injury benefits before the injury occurs, with a reminder at the time of injury that this information remains easily accessible at any time.
  2. Reassure the injured worker of the employer’s commitment to pay for all reasonable and necessary medical care from the best available medical providers.
  3. Be responsive with good customer service that demonstrates a “we care” attitude through early communication, respect, empathy and transparency toward the injured worker (without creating distrust by “hounding” the injured worker).
  4. Earlier identification and referral of appropriate cases for medical management can create a sense of urgency that actively engages key parties in the recovery process.
  5. Provide supportive tools and promote a sense of injured worker agency and empowerment for their own recovery by following the physician’s instructions, getting rest and exercise, eating a balanced diet, taking prescribed medications in a timely way, seeking emotional support and maintaining a positive attitude.

Is This All Easier Said Than Done?

Absolutely. But it’s consistently doable with the right program design and team. The positive outcomes available for injured workers and employers are well worth the effort. &

[i] See Florida House Bill CS/HB 837, signed into law on March 24, 2023, which requires the injured worker and their attorney to disclose, among other things: (1) if the medical provider sold its accounts receivable to a third party or factoring company, the name of the third party and the dollar amount for which the third party purchased the accounts, (2) any available health care, workers’ comp or injury benefit coverage available at the time of treatment, and (3) the identity of any person who referred the injured worker for treatment under a letter of protection. This bill says the attorney-client privilege will not prevent these disclosures, and “the financial relationship between a law firm and a medical provider, including the number of referrals, frequency and financial benefit obtained, is relevant to the issue of the bias of a testifying medical provider.”

Bill Minick is an attorney, risk management adviser, and EVP at OccMD, based in Dallas. He can be reached at [email protected]. As president and chief medical officer of OccMD Group, Dr. Melissa Tonn delivers expertise on complex work injury issues, including extent of injury and return to work. For decades, she has been integrally involved with workers’ compensation programs for major public and private employers, and served in leadership roles for large Texas and national occupational injury and disability professional associations and local non-profits.

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